With this it will be convenient to discuss the following:
Amendment 334, in clause103,page59,line11,leave out “may” and insert “must”.
This amendment would ensure cooperation and information sharing between OfS and UKRI.
Amendment 333, in clause103,page59,line12,after “functions” insert—
‘(1A) The OfS and UKRI must cooperate with one another on—
(a) the health of disciplines,
(b) awarding of research degrees,
(c) post-graduate training,
(d) shared facilities,
(e) knowledge exchange and
(f) skills development”.
This amendment sets out where UKRI and the OfS must cooperate on issues at the interface between teaching and research.
Amendment 335, in clause103,page59,line13,leave out subsection (2).
This amendment would ensure cooperation and information sharing between OfS and UKRI.

Jo Johnson: I thank the hon. Gentleman for giving me the opportunity to explain further how the OFS and UKRI will work together on a range of issues relating to their respective remits. I appreciate the considered tone of his comments and observations. We understand that these matters are important and we have taken considerable care to try to address when crafting the reforms and the Bill. I am happy to try to give some further clarification now as to how we see those two bodies working.
I assure the Committee that the Government are committed to the continued integration of teaching and research within the HE system. We believe the Bill reflects that and proposes safeguards to ensure joint working, co-operation and the sharing of information between the OFS and UKRI. Both organisations also have a statutory duty to use their resources in an efficient and effective way, meaning they will look for all opportunities to collaborate and share information.
On the specific points made by the hon. Gentleman, I will start with those relating to changes to the machinery of Government in July. We understand his concern about the potential impact of those changes, with the Department for Education now having responsibility for higher education but research policy remaining the responsibility of the Department for Business, Energy and Industrial Strategy. For my part, I am committed to my role across the two Departments and will be working closely with the two Secretaries of State and the heads of the two new organisations coming into existence through the Bill, UKRI and the OFS, to ensure a coherent approach and to maintain the continuity of day-to-day business.
As the Committee has seen, the Bill is supported by me, a shared Minister across the two Departments, and as the hon. Gentleman will see on the back page of the Bill, it also has important support from senior members of the Government. That provides significant continuity across the two Administrations we have seen since the general election, including the current Prime Minister, who supported the Bill in her former capacity as Home Secretary, and the current Secretary of State for Business, Energy and Industrial Strategy in his former capacity as Secretary of State for Communities and Local Government, and so on and so forth. There is significant continuity.

With this it will be convenient to discuss amendment 187,page92,line38, at end insert—
‘(6) UKRI must, in appointing members of each Council, have regard to the desirability of the members (between them) having experience of research in the higher education sector in England, Scotland, Wales and Northern Ireland.”

Amendments made: 250, in schedule 9, page93,line35, leave out “, allowances and expenses”.
This amendment removes an unnecessary reference in paragraph 7(1) of Schedule 9 to allowances and expenses for members of UKRI or Council members as they are covered in paragraph 7(2).
Amendment 251, in schedule 9, page93,line37 leave out “The Secretary of State” and insert “UKRI”.
See the explanatory statement for amendment 249.
Amendment 252, in schedule 9, page93,line43 leave out “the Secretary of State” and insert “UKRI”.
See the explanatory statement for amendment 249.
Amendment 253, in schedule 9, page94,line8, leave out “, allowances and expenses”.
This amendment is consequential on amendment 254.
Amendment 254, in schedule 9, page94,line9, at end insert—
‘( ) UKRI must pay, or make provision for paying, to or in respect of a person who is an employee of UKRI, such sums as UKRI may determine with the approval of the Secretary of State in respect of allowances or expenses.”
This amendment makes the duty to pay allowances and expenses to UKRI employees consistent with the power to pay such allowances or expenses to former employees inserted by amendment 255.
Amendment 255, in schedule 9, page94,line9, at end insert—
‘( ) UKRI may pay, or make provision for paying—
(a) to or in respect of a person who is or has been an employee of UKRI, such sums as UKRI may determine with the approval of the Secretary of State in respect of pensions or gratuities, and
(b) to or in respect of a person who has been an employee of UKRI, such sums as UKRI may determine with the approval of the Secretary of State in respect of allowances or expenses.”—
This amendment makes clear that UKRI has power, subject to approval by the Secretary of State, to make pension provision for its employees and former employees other than under the Superannuation Act 1972 (as provided for in paragraph 8(4) of Schedule 9), to pay them gratuities and to pay former employees allowances or expenses.

Gordon Marsden: I beg to move amendment 331,in schedule 9, page95,line26, leave out “any” and insert “some”
This amendment seeks to clarify which functions UKRI intends to delegate to its Councils.
This amendment relates to paragraph 12 of the schedule, “The delegation of functions by UKRI”. This probing amendment raised a metaphorical eyebrow when we— and, I think, others—were looking through the Bill. Paragraph 12(1) of the schedule states:
“UKRI may delegate any of its functions to—
(a) a member of UKRI,
(b) an employee authorised for that purpose,
(c) a Council or a Council sub-committee, or
(d) a general committee.”
I am fairly confident that this is not designed to confer—to borrow a phrase from another context—Henry VIII-type powers—on UKRI to delegate. And I am fairly confident that when the Minister responds he will probably say that it replicates—I do not want to be so unkind as to use the word “boilerplate”—things that normally appear in Bills at this point in the proceedings. However, I think it is worth probing because in this instance it is not simply that the Government are setting up a new body in UKRI, but that the relationship between that body and its research councils, for example, is one that has inevitably provoked a lot of comment and some concern as to how that process will be taken forward.
This probing amendment seeks to clarify the division of responsibilities between UKRI and its councils and, at least, to elicit from the Minister some sense—I appreciate this is an evolving conversation—of whether that particular subparagraph of the schedule is intended to be a passe-partout, if I may put it that way, for this process.
I also say that because we had the interim chairman, Sir John Kingdom, before us in our somewhat attenuated evidence session. He has also very recently appeared before the Science and Technology Committee. I confess that I have only scanned the minutes of that meeting; I presume the Minister has read them from cover to cover. It seemed to me that in the best traditions of the civil service, from which he emanates, Sir John had skipped rather lightly on some of those questions to the Committee thus far; but that is for members of the Science and Technology Committee to judge.
It is important that we try to get some greater clarification before the Bill goes to the other place, not least because the Government will undoubtedly be peppered with questions and observations by Members of the House of Lords. I am actually trying to give the Minister a little assistance.
To be fair, the factsheet published by the Government, “Higher Education and Research Bill: UKRI Vision, Principles & Governance”, makes the point that there is much detail still to come. It states:
“The government is working with Sir John, our existing Partner Organisations and key stakeholders to explore detailed organisation design options…This will inform the final design which will be refined and agreed in partnership with the UKRI Chief Executive and Board once appointed.”
I appreciate that that will not necessarily happen anytime soon. The factsheet then says:
“Further detail will be set out in guidance including the framework document between BEIS and UKRI, which will be published once agreed.”
I have already referred to, and the Minister has commented on, the evolving implications of the machinery-of-Government division of research in that fashion. Therefore, as well as moving the amendment, which, as I have said, is a probing amendment designed to reflect the concerns, may I ask the Minister—I will do so in a constructive way—how he sees that framework document developing and at what stage he thinks it might be available to be considered? Does he think that it will be available before the Bill leaves this House, or when it goes to the other place?

Gordon Marsden: I beg to move amendment 332,in schedule 9, page97,line1, leave out
“except with the consent of the Secretary of State”
This amendment seeks to understand how UKRI will work with the private sector.
This is, again, a probing amendment. We are genuinely trying, along with people in the scientific community and associated areas, to understand the extent to which UKRI will work with the private sector. The Minister is keen on the private sector. We are keen on the private sector and believe it has a very important role to play. The way in which research councils can currently enter into contracts to conduct spin-out activity and form companies—MRC Technology is one example that has been cited—is extremely valuable to research and innovation.
At the risk of being repetitive, money will be tight in the next five years. I am sure that the Minister will fight his corner very vigorously, but however generous the Government are in going beyond the assurances they have already given about Horizon 2020, money will be tight. Therefore the ability to generate that activity and form companies will be important. It is also important for maintaining the entrepreneurial profile of UK plc. The current position—though the Minister may wish to clarify it further—is that this is what research councils can do. It would be useful to know what he envisages their being able to do in the future. In the 2015 spending review it was announced that Innovate UK would convert £165 million of its grant into new financial products. It would be helpful to clarify the extent to which the Secretary of State’s consent would be needed to operate those new financial products and any future products that Innovate UK might develop, such as equity investment. We touched on these issues in the evidence session with the chief executive of Innovate UK, but it would be helpful if the Minister could go further when he comments on the mechanism we have chosen to raise these issues.
I appreciate that there may be changes, or goodies, coming down the line in the autumn statement. No doubt we will find that out in due course.

Gordon Marsden: We now move on to some of the meat of an area which has developed quite a head of steam: the relationship between UKRI and the councils. We have previously talked today about some of the ways in which UKRI might devolve its powers, and the Minister has been helpful regarding the councils, but the devil is always in the detail of parliamentary scrutiny.
There is considerable disquiet about some of the blanket powers that the new body UKRI may have and, indeed, that the Secretary of State may give him or herself. This is not a comment on any particular Secretary of State, or any particular Universities Minister. If we are to make good legislation, we need to work to the potential scenarios that are most difficult rather than to the simplest ones. If everything went simply in government we probably would not need to think about this, but of course things do not always go simply.
I come back to the reputational issue, which I touched upon earlier when commenting on the amendments tabled by the hon. Member for Kirkcaldy and Cowdenbeath. We are at a critical period in our higher education history because of the big question marks over Brexit, and the lesser—although still significant—question marks over the machinery of Government changes. We should be doing everything we can to reassure the academic community and indeed the broader business community. We should not propose changes, potential changes or potential shutdowns that will cause problems. It is all very well for Ministers to say, “Well, this would never happen,” or, “It would be dealt with in guidance,” or whatever, but I am sure that we can all think of examples over the years where changes in legislation have set off great concern and scepticism, and in some cases had very bad financial and economic consequences involving overseas investors and overseas academic institutions.
We are debating this Bill at a time when our researchers, our research institutions and research bodies in our universities are being put under severe pressure and are concerned about their future relationship with organisations within the EU. It is highly relevant to changes that might be made to the councils of UKRI that changes in the EU or changes in our relationship with our EU partners do not necessarily have an adverse effect only on relationships with the EU, of course. They have, or can have, an adverse effect on relationships with other international institutions. At a Royal Society fringe meeting at our party conference last month at which I was present, comments were made by Professor Hemingway to the effect that when we think about these sorts of things, we also need to think about the implications for research in francophone Africa or lusophone Latin America, for instance, in terms of what we need to do to maintain our relationships there.
All these things are connected and related. That is why apparently arcane issues around the Secretary of State being allowed to change the name or responsibility of the council by issuing a statutory instrument subject to the affirmative procedure are important. Behind that dry statement lie some of the issues that I have described. As far as I can see, the Bill does not require the Secretary of State to undertake any public consultation before changing the name or responsibilities of a council. We have already had some discussion about the merits or otherwise of automatically deleting references to the Privy Council from the structures and architecture of  the Bill, and the OFS in particular. The Government declined to think creatively about ways in which the Privy Council might be a backstop.
The Royal Society is particularly concerned about this, as are most of the major research-intensive university groups. It is worth the Committee reflecting on the Royal Society’s position statement.
“The landscape of Research Councils has changed over time. The Bill giving the Secretary of State the authority to change their number, name, and fields of activity through a statutory instrument is a pragmatic reflection of this. While this change is reasonable, both Parliament and the research community should be able to inform and scrutinise properly any major proposed changes to Research Councils’ form and function. The Society believes the Bill should include a duty for the Secretary of State to consult with the research community on any proposal for major Research Council reform.”
It says it should include a duty, not a possibility. I emphasise those words because I do not want the Minister to come back with the boilerplate response that if the Secretary of State had to consult on all these matters, he or she would not get anything done. We are not suggesting that and nor is the Royal Society. It is saying there should be a duty to consult on a proposal for any major research council reform.
The issue has also been taken up by MillionPlus and the Russell Group. The Russell Group specifically sought clarification that the affirmative procedure must be used to change the councils. That is not a point we have included in any amendments but it is certainly a concern that the Minister should strongly focus on.
We have tabled these amendments to emphasise the vital role of consultation, not simply because it is the right thing to do, but because if it is not done there will be negative effects on our economy, the wider world’s perception of us, the status of our research councils and the flourishing of UKRI, which we all want to develop strongly in its formative years.